Bonuses to be halved at Merrill

Wednesday 3 December 2008 11:33 BST

Merrill Lynch department heads were today being told to cut year-end bonuses for their staff by half.

Employees, thousands of whom are based in the City, will not be told their bonuses until the end of the month. But sources said divisional managers were being briefed on how much they will get to distribute, with the order being that the average cut will be 50%, Bloomberg reported.

While a 50% drop may sound bad, it is not as extreme as the 70% average reduction for Wall Street-based banks predicted by pay consultancy Johnson Associates last month.